On March 25, Meituan (3690.HK) released its fourth quarter and full-year results for 2021. The annual revenue was 179.1 billion yuan, a year-on-year increase of 56%. Meituan’s takeaway achieved revenue of 96.3 billion yuan.
During the same period, the cost of Meituan’s food delivery riders was 68.2 billion yuan, and the cost of riders accounted for 71% of the food delivery revenue. The adjusted net loss in the fourth quarter expanded to 3.9 billion yuan year-on-year, and the adjusted net loss for the year was 15.6 billion yuan, compared with a gain of 3.12 billion yuan in the same period last year.
The financial report shows that the new business, which is mainly based on community group purchases, suffered a huge loss of 38.4 billion yuan last year, an increase of 252% year-on-year. The operating net profit of Meituan’s takeaway and catering business was 6.2 billion yuan, an increase of 121.4% year-on-year; the operating net profit of in-store hotels and tourism business was 14.1 billion yuan, an increase of 80.0% year-on-year. This means that the operating net profit of the other two businesses is far from being able to make up for the huge loss of Meituan’s new business.
In the conference call after the financial report, Meituan executives said that community e-commerce is gradually returning to rationality under the current new regulatory environment, and this year, Meituan preferred businesses such as We will continue to focus on resource allocation and the improvement of growth quality, and pursue long-term benefits rather than short-term benefits. Previously, Wang Xing also stated that Meituan’s preferred choice as a community e-commerce business may be the best opportunity to meet in 5 or even 10 years.
As of the close on March 25, Meituan fell 8.16%.
Last year, the subsidy for riders was 14 billion yuan, and the commission rate for food delivery was 4.1%
Meituan’s revenue mainly includes food delivery, in-store hotel and tourism business , new business and the other three. Among them, food delivery is its core business.
In 2021, the transaction amount of Meituan’s food delivery platform will be 702.1 billion yuan, a year-on-year increase of 43.6%; the number of transactions will reach 14.4 billion, a year-on-year increase of 41.6% %. In the fourth quarter of last year, the revenue of the food delivery business was 26.1 billion yuan, a year-on-year increase of 21.3%, and the operating profit margin increased from 4.1% to 6.6%, mainly due to the increase in the proportion of online marketing service revenue and the reduction of riders’ seasonal subsidies.
In terms of commissions, in 2021, the commission income (technical service fees) obtained by Meituan Food through merchants will be 28.5 billion yuan. Compared with the annual transaction amount, the commission rate of the food delivery platform About 4.1%.
In addition to merchant commission income, Meituan’s total revenue including commissions, performance service fees, and online technical service fees is 96.3 billion yuan, most of which is the cost of rider delivery. The financial report shows that during the same period, the delivery cost of Meituan’s takeaway riders was 68.2 billion yuan, an increase of 38.3% over the previous year, accounting for 71% of Meituan’s total takeaway revenue.
Meituan said that in 2021, Meituan’s catering distribution service revenue from merchants and users will be 54.2 billion yuan, while the annual rider distribution cost will be 68.2 billion yuan . The above data shows that Meituan spent 14 billion yuan in direct subsidies for riders throughout the year.
In the conference call after the earnings report, Meituan executives expressed full confidence in the performance of the food delivery business this year. “Once the control measures in medium and high-risk areas are lifted, the recovery will be very fast, and I am very optimistic about the growth trend of this business.”
Previously, Meituan had issued commission discounts Some analysts pointed out that this may affect the subsequent revenue of Meituan. In this regard, Meituan executives said that this does not pose a risk, because the income of the online marketing business can make up for the related losses.
Meituan CEO Wang Xing said that Meituan will firmly fulfill its platform responsibilities, actively participate in the occupational injury protection pilot under the guidance of policies, and ensure that the pilot project is carried out according to the planned schedule , and will pay all fees for participating pilot riders.
The new business has a huge loss of 38.4 billion yuan, and the executive said that “Meituan has a strong vitality and potential”
Meituan’s new business and other On the one hand, it mainly includes Meituan Select, Meituan Flash Sale and Meituan Shopping.
New business revenue grew strongly but continued to burn cash. In 2021, the revenue of this business will increase by 84.4% year-on-year to 50.3 billion yuan, and the operating loss will expand from 10.9 billion yuan in 2020 to 38.4 billion yuan in 2021, a year-on-year increase of 252%.
In the fourth quarter of 2021, revenue from new business and other segments increased by 58.7% year-on-year to RMB 14.7 billion, and operating loss widened to RMB 10.2 billion year-on-year.
In the post-earnings conference call, executives expressed confidence in the business despite widening losses. Meituan said, the new regulatory environment faced by community e-commerce is conducive to the stable and healthy development of this business. At the same time, the community e-commerce business is gradually returning to rationality in the current environment. “Meituan has shown strong vitality and potential, and will add more vitality to the retail industry.”
The executive said that he will continue to focus on resource allocation and growth quality this year. To improve, pursue long-term economic benefits rather than short-term benefits; further improve operational capabilities and efficiency, optimize logistics and distribution capabilities, and hope to build a healthy ecosystem through various efforts.
Previously, Wang Xing expressed firm confidence on the conference call. He mentioned that Meituan is preferred as a community e-commerce business, which may be the best opportunity to meet in 5 or even 10 years. “The opportunity to build e-commerce infrastructure is not so common. If we look at the history of Taobao and JD.com, we agree that infrastructure construction requires a lot of investment. Once completed, it will have the opportunity to reach a wider range of users and have The opportunity to create a new value chain will bring new value to the society, and we are very firm on this.”
In addition, Meituan said that the net other income was the same as that of 2020. In the fourth quarter of 2021, net other income decreased by RMB 689.1 million to RMB 594.0 million compared with the same period of last year, mainly due to lower investment income. At the same time, data shows that in 2021, Meituan’s annual R&D investment will increase by about 53.1% year-on-year to 16.7 billion yuan.